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My company has a FFP GOCO contract that was issued a stop-work order 10/1/2013 referencing FAR 42.1303. This regulation allows “top-work orders may be used, when appropriate, in any negotiated fixed-price or cost-reimbursement supply, research and development, or service contract if work stoppage may be required for reasons such as advancement in the state-of-the-art, production or engineering breakthroughs, or realignment of programs.” Work stoppage in this case was not for any of the allowed conditions cited in this regulation and doesn't relate to the type of work being performed. The contract includes FAR 52.242-15 which explicitly requires “The [stop-work] order shall be specifically identified as a stop-work order issued under this clause.” Since this requirement was not fulfilled, I interpret the stop-work order as invalid. My employees were told to leave the facility at noon on October 1. We received a notice to resume work on evening 10/22 and all workers were back at work 0600 10/23. All contract modifications before and after the shutdown have POP inclusive of the time the government was shutdown. All workers were told by me that the length of time of the shutdown was uncertain and that they should be prepared to return to work as soon as it was over. All workers were paid during this time. (A possible bit of relevant info is that the contract involves execution of tasks that assure the health and welfare of people on the installation as well as the environment and are required by state and federal laws. I called this to the attention of the KO prior to the shutdown and was told after the stop-work order that the KO would get back to me concerning the potential violation of these requirements. I believe this tied my hands with my employees since I did not know if they would be called back at a moments notice.)

Since this is a FFP contract and my company worked all days the facility was open in October.

Since the KO cannot change the rates of the FFP based upon changes in cost...

Since the stop-work order was not valid...

I submitted a normal invoice at the end of the month. This invoice was approved and then later rejected just prior to payment since "congress had not authorized funds." I immediately filed a REA for the full month's FFP labor amount in addition to costs associated with additional administrative and management tasks my company was forced to perform as a result of the shutdown. The REA was denied. An appeal was filed with the ASBCA. The total amount claimed is <$90K.

From my perspective, this should be a slam dunk but the government has placed multiple attorneys on the case, they are requiring enormous volumes of discovery information, and they appear unwilling to negotiate in good faith. I suspect they are pushing their weight because I have limited financial resources and they think I am going to back down. All CPARS for the contract are "exceptional" across the board, my company can document millions of $ we have saved the government in performance of the contract, and government customers to this GOCO have written numerous letters applauding the service they receive so I don't believe there is a plan to get rid of us.

My question is this...........am I missing some obvious reason why the government doesn't have to pay their bill? Is there some lessor known rule that allows the government to change FFP price due to some sovereign act?

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Guest Vern Edwards

My question is this...........am I missing some obvious reason why the government doesn't have to pay their bill? Is there some lessor known rule that allows the government to change FFP price due to some sovereign act?

Who the heck knows what you may or may not have missed? How do expect anyone to figure out your situation from the jumble of information you provided above?

Forget the Sovereign Acts Doctrine. Don't even think about it.

If you haven't already done it, CALL AN ATTORNEY. If you already have an attorney, ask him or her. If your case is already before the ASBCA, stand by, you'll have an answer in a few months (or years). As for the government's lawyers, you say:

[T]he government has placed multiple attorneys on the case, they are requiring enormous volumes of discovery information, and they appear unwilling to negotiate in good faith. I suspect they are pushing their weight because I have limited financial resources and they think I am going to back down.

Exactly. Maybe you should.

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Thank you for rapid replies.

While the sovereign act provides the government protection from liabilities incurred during the shutdown but as per Raytheon STX case, it does absolve the government from all contractual responsibilities. For example, contracts that provide facilities that are made unavailable during the shutdown " carried with it the implied promise that if they were not, [the government] would stand the resulting cost.” in any case, the Congresional bill passed for funding provided a retroactive start of funds to Oct 1 and continuation of the 2012 defense appropriations.

I guess the best advice is to get an attorney. If the case is a slam dunk, then the cost will be recouped.

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